On February 4, 1887, President Grover Cleveland signed into law, the very first piece of legislation that created a regulatory agency. On that date in our nation’s history, the Interstate Commerce Commission was created. This event represents in many ways, the birth of the progressive assault on the U.S. Constitution. The ICC for those of you who aren’t familiar with its impact upon the daily lives of every person living within our borders, was granted the power and authority of all three branches of our federal government. Its creation represents perhaps the single most important step in destroying the checks and balances system so thoughtfully put into place by our nation’s founders. The theory was that our nation had become to large and complex to govern in the manner proscribed by the constitutional form of governance created close to 100 years prior to that date. A new system was needed where independent regulatory agencies would be able to take a more proactive role in the specific areas of their purview. These independent agencies would provide, where necessary, a more efficient address of problems needing solution than the designed gridlock built into our constitutional architecture. This belief was born out of the gridlock of the 1860′s, 70′s, and 80′s, in which the railroads were the target of a concerted effort to gin up complaint in regards to the prices charged customers who might seek passage on the short hauls. During the entire decade, endless debate was held in Congress, and shockingly, a solution could not be agreed upon. (It is worthy of note that Milton Friedman highlighted this very debate and ensuing solution as a part of his, “Free to Choose,” series, specifically, episode seven. His argument, and one that I happen to agree with, was that a solution was not necessary, since the problem was overblown, not real, and would have been better addressed by simply allowing the market place to sort itself out, as it always had previously. It should also be noted that rail travel in the United States at that time, even on the short hauls, was far cheaper than in the European nations, where government intervention was far more prevalent.)
As a direct result of the Interstate Commerce Act of 1887, the disparity of the long haul versus short haul rates was solved by raising the former to reflect the latter, rather than the other way around. It took about a decade for the consumer advocates of the day to move on to their next crusade, and left the control of the ICC completely up to the industry experts of the time, who were of course the very owners of the railroads that the Commission in question was supposed to be regulating in the first place. The ICC was used as a regulatory bludgeon to keep smaller companies from entering into the already very competitive railroad market, and when Trucks became a viable economic alternative, and quickly grew into a superior economic alternative, the trucking industry got itself added to the purview of the ICC. Today of course, as a result of this, there are trucking companies in America which make large profits without owning or operating a single truck. They simply buy and lease ICC licenses, adding a layer of cost to every item purchased by any citizen anywhere in America at any time.
Worse than that however is the fact that as is almost always the case, the specific problems sought to be solved by this particular agency were only made worse. By the time the 10th birthday candle was placed on the top of the ICC cake, the original intention was ignored and or forgotten completely, and a whole new scope of regulatory authority and control was fabricated, by the agency itself. This by the way is a real danger to anyone wishing to live free from the yoke of government tyranny. The ICC had failed completely in its original mission, as almost every agency does. That failure however was never accounted for, nor was any accounting sought. Instead, the agency simply wrote itself a new mission, which was of course completely opposite of the intended purpose. The progressive model so expertly thrust upon us, to the point where we’ve missed its implementation entirely, is that the Legislators draft a law with extremely vague language. A broad vision is laid out in terms of the area of our society that they wish to see placed under the control of said agency. The details of the new law are proscribed to be filled in later by the newly created government agency. An example of this in action is the Dodd/Frank Law that created the Consumer Financial Protection Bureau. Congress passed a law which said, we want to regulate how our credit markets will operate, so that the credit consumer would be protected against greedy money lenders looking to do harm to the little guy. It was pretty much that vague, except that a new government agency, The CPFB, would write the rules necessary to place the entire financial services sector of our economy under complete control of the newly formed regulatory authority. Here we are some 5 years later, and Richard Cordray, the former Ohio Attorney General that Ohioans got tired of after only 4 short years, has carte blanche to rewrite how an entire sector of our economy will function. Never mind fellow little people, that he has not one second’s experience in the function of our capital market place, nor will he have any bothersome oversight to interfere with him as he writes those rules, nor even what those rules will ultimately be. If you wish to purchase a house, ever, it’s up to Richard Cordray now, how or if that will happen.
The agency you see, not only comes with the power to write its own rules, but also with the power of the Executive Branch, since this is where all agencies reside, to manage how those rules are enforced. Beyond that however, in all but the most severe cases, the courts have by and large simply abdicated their own place in this process by allowing these entities to adjudicate their own disputes. For the most part, the answer of the Judicial Branch has been to allow the agencies wide leeway in terms of settling any differences that private citizens may have with the management of agency business. So much for separation of power, one of the principle tenets of our constitutional republic.
Every four years in this nation we hold national beauty pageants designed to choose the leaders of our Executive Branch. Invariably those leaders come from one of two major political parties, and any belief that this will change any time soon is simply the worst form of naive wishful idiocy. Sorry Gods of the Third Party, but that is fact, and no amount of whining combined with coercive bullying will change that. The system is rigged in favor of the two major political parties, and that state of being rigged has been codified into our national election law. If you expect the apparatchiks of the two major political parties to ever work together in order to relinquish their grip on power, I happen to own a bridge that spans from Brooklyn to Manhattan in the State of New York that I’d be willing to sell to you. Short of an Article V convention, this state of Democrats and Republican owning a choke hold on our national political scene will not go away. (Here by the way is an excellent addition to the Article V list, for those interested.)
Even if however, a Libertarian Candidate for President let’s pretend, actually manages to win an election, that President would still be stuck with managing Federal Agencies who have been previously granted the authority to act on their own behalf and govern their individual fiefdoms as they see fit. George W. Bush did succeed in some small measure to curb the activities of the federal behemoth, but mostly, all of the independent regulatory agencies operate in mostly the same fashion whether there’s an R or a D following the Chief Executive’s name. So, while I singled out George W. Bush, simply because he was the last one with an R, the same could be said for every Republican President from 1887 onward. They simply do not have the means available to get a hold of the monster created, as the laws as written have created these individual heads of the Hydra to operate outside of any possible constraint. (I am seeing yet another good argument for an Article V Convention here. I would also like to point out that one President did actually try to place legal limits upon agency authority and scope in our country, and that man was Richard Nixon. He failed spectacularly, and found himself chased from town.) The point is, that no matter what promise may or may not be made, getting hold of the monster and curbing its scope is impossible without repealing the existing law that created it, and it will take much more than electing one single Libertarian with the right rhetoric in order to see this accomplished.
We on the political right won’t get our way until we get our collective crap together and begin winning a lot of elections. Until that day, be prepared to live life in the Worker’s Paradise my friends. I’ll see you in the reeducation camps.
The previously mentioned episode of, “Free to Choose.”